Since the start of the new year of 2022, the coinbase stock has been ranging from 150-210. This range is considered an accumulation phase for a potential mark up soon. Cryptocurrency has a huge impact on the stock of coinabse as it is one of the largest crypto exchanges with billions of dollars’ worth of volume. Since market is ranging, we are anticipating another lower bottom, which will form a double bottom at 150. This double bottom if prints a bullish engulfing, that would be a bullish signal for us to go long. The fine print on this bullish leg up has the potential to reap around 25% gains on the risk.

Descending trendline has been broken out for buys and has been validated by the candles opening and closing above the trendline. The duration of the trendline tends to be for around 6 months now. Therefore, the breakout seems to be major for the bullish rally in the upcoming months.

We won’t be using the retracement technical factor in this setup as we are looking for a double bottom to reverse the trend. Also, we do not have a swing pivot point at the previous low with which the retracement can be drawn.

Both the EMA’s are bearish with a bearish death cross. After the breakout sell of the EMA 50, market has retested the EMA 50 and is heading down. Once the double bottom is formed and the bullish confirmation provided, we will be looking towards the EMA 200 as the potential profit target.

In an ideal scheme of technical factors, the best use case of the oscillators would be when RSI and CCI have fallen into the over-sold region and formed some sort of a bullish divergence. Both the oscillators are already in a negative territory, therefore, bullish divergence on a daily time frame can be the final catalyst to pump the stock up.

Coinbase is a long hold blue chip. The underlying value of the stock is usually deterrent of the crypto market to an extent. But to say the least, we are being provided discounted price for the stock right now.

Coinbase weakens while forming double bottom

Apr 06 2022

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